𝐂𝐚𝐧 𝐒𝐝𝐧 𝐁𝐡𝐝 𝐜𝐥𝐚𝐢𝐦 𝐭𝐚𝐱 𝐝𝐞𝐝𝐮𝐜𝐭𝐢𝐨𝐧 𝐨𝐧 𝐦𝐨𝐭𝐨𝐫 𝐯𝐞𝐡𝐢𝐜𝐥𝐞 𝐛𝐨𝐮𝐠𝐡𝐭? 𝐖𝐡𝐚𝐭 𝐧𝐞𝐞𝐝 𝐭𝐨 𝐛𝐞 𝐝𝐨𝐧𝐞 𝐟𝐨𝐫 𝐭𝐚𝐱 𝐝𝐞𝐝𝐮𝐜𝐭𝐢𝐨𝐧?

01𝐘𝐨𝐮 𝐚𝐬𝐤

02𝐂𝐚𝐧 𝐒𝐝𝐧 𝐁𝐡𝐝 𝐜𝐥𝐚𝐢𝐦 𝐭𝐚𝐱 𝐝𝐞𝐝𝐮𝐜𝐭𝐢𝐨𝐧 𝐨𝐧 𝐦𝐨𝐭𝐨𝐫 𝐯𝐞𝐡𝐢𝐜𝐥𝐞 𝐛𝐨𝐮𝐠𝐡𝐭? 𝐖𝐡𝐚𝐭 𝐧𝐞𝐞𝐝 𝐭𝐨 𝐛𝐞 𝐝𝐨𝐧𝐞 𝐟𝐨𝐫 𝐭𝐚𝐱 𝐝𝐞𝐝𝐮𝐜𝐭𝐢𝐨𝐧?

03𝐎𝐮𝐫 𝐚𝐧𝐬𝐰𝐞𝐫

1. Yes, as long as the motor vehicle is used for business purpose and registered or documented as proof of ownership such as invoices, resolution and receipts by refer to PR5/2014 paragraph 6 and 13.

2. For expense incurred which is wholly and exclusively incurred in the production of income is allowed for tax deduction.

However, if the motor vehicle provided to employee contain the expenses on private usage and petrol claimed (eg. travel from home to office or office to home, keep at employee house and can be used by his family members), the benefit shall be declared as benefit-in-kind (BIK) under Form EA by referring to PR11/2019 paragraph 6.1.

3. However, according to PR 6/2015 para 5.2(b), there is restriction on capital allowance claimed for passenger car.

New passenger car + RM100,000 < Cost < RM150,000 – restricted to RM100,000

New passenger car + Cost > RM150,000 – restricted to RM50,000

Reconditioned (secondhand) passenger car – restricted to RM50,000

4. To claim for the tax deduction, the employer shall keep sufficient records as evidence at least 7 years by refer to PR4/2000 para 3.3.5 and PR11/2019 para 9.2.

𝐒𝐨𝐮𝐫𝐜𝐞

1. Paragraph 6 of Public ruling 5/2014 Ownership and use of asset for the purpose of claiming capital allowances

Legal owner: name is registered or documented as proof of ownership.

Beneficiary owner: incurred the expenditure and payment for the asset that can be proved in the books of accounts with supporting documents such as invoices, vouchers and receipts.

2. Paragraph 13 of Public ruling 5/2014 Ownership and use of asset for the purpose of claiming capital allowances

A beneficial owner or legal owner is entitled to claim the full portion of capital allowance if the asset is used wholly and exclusively for business purposes.

3. Paragraph 5.2 (b) of Public ruling 6/2015 Qualifying expenditure and computation of capital allowances

Restriction on capital allowance claimed for passenger car.

4. Paragraph 6.1 and 9.1 of Public ruling 11/2019 Benefit-in-kind

In accordance with subsection 83(1) of the ITA, the employer is required to report in Form EA and EC and Form E for the employer, all payments in respect of services provided by the employee including all types of BIKs.

This includes the benefits provided for the spouse, family, servants, dependent or guest of the employee.

5. Paragraph 9.2 of Public ruling 11/2019 Benefit-in-kind

Paragraph 3.3.5 of Public ruling 4/2000 Keeping sufficient records (Companies and co-operatives)

In accordance with section 82 of the Income Tax Act 1967, the employer is also required to keep records and receipts pertaining to all claims on expenses incurred on the employees.

These records and receipts must be kept for a period of seven (7) years from the end of the year to which any income from that business relates for the purposes of verification of claim during a tax audit. (PR11/2019 para 9.2).

#ktp

#thk

#benefitinkind

#irb